Accounting information systems are the oldest and most widely used information s
ID: 2593609 • Letter: A
Question
Accounting information systems are the oldest and most widely used information systems in business. Computer-based accounting systems record and report the flow of funds through an organization and produce important financial statements. Write an essay to explain in some details the role of the accounting information system in achieving organizational objectives. In your essay discuss three of the most common accounting systems such as order processing, inventory control, accounts receivable, account payable, payroll, etc. Support your answers with relevant examples...?
Explanation / Answer
An accounting information system (AIS) is a tool that collects,stores, amanges and processes data that is generated in normal day to day functioning of the business. The data collected is then converted into reports which are used by accountants, consultants, business analysts, management in order to come up with decisions. It is generally a computer based system that has replaced the age old paper and pen method of recording transactions.
This transition has led to betterachivement of many organisational objectives like efficiency in operations, timeliness in decision making and cost reduction. The effects of Accounting information systems are more relevant in business processes like order processing, inventory control and payroll. For example in case of order processing an AIS would automatically send orders to vendors so as to accomodate inventory at required levels. For payroll, salary slips and other employees related documents would be automatically generated and sent to each employees without much human intervention. Similarly in inventory control, the purchase manager would be alerted when inventory level is approaching reordering level. All this was not possible in erstwhile methods.
Thus Accounting Information system has helped organisations achive objectives.